1
Exhibit 3.2
CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
OF
HANOVER DIRECT, INC.
(Pursuant to Section 242 of the General
Corporation Law of the State of Delaware)
_________________________________________________
The undersigned hereby certifies as follows:
1. That he is President of HANOVER DIRECT, INC.
2. That the Certificate of Incorporation was filed with
the Secretary of the State of Delaware on the 15th day of April, 1993.
3. That the amendment to the Certificate of
Incorporation as set forth herein and recommended by the Board of Directors was
duly adopted in accordance with Sections 228 and 242 of the General Corporation
Law of the State of Delaware.
RESOLVED: That the first paragraph of ARTICLE FOURTH be amended as
follows:
FOURTH: The total number of shares of all classes of stock
which the Corporation shall have authority to issue is 168,172,403 shares, of
which 40,000 shares shall be class B 8% cumulative preferred stock, par value
$.01 per share and stated value of $1,000 per share (the "Class B Preferred"),
861,900 shares shall be shares of 7.5% cumulative convertible preferred stock,
par value $.01 and stated value of $20.00 per share (the "7.5% Preferred"),
5,000,000 shares shall be shares of additional preferred stock, par value $.01
per share (the "Additional Preferred Stock"), 150,000,000 shares shall be
shares of common stock, par value $.66-2/3 per share (the "Common Stock"), and
12,270,503 shares shall be shares of class B common stock, par value $.01 per
share (the "Class B Common Stock").
2
RESOLVED: That the following paragraph be added to the end of ARTICLE
FOURTH:
4. Additional Preferred Stock
(a) The Additional Preferred Stock may be issued from time to
time in one or more series, with such distinctive designation or title and in
such number of shares as may be fixed by resolution of the Board of Directors
without further action by stockholders. The Board of Directors is expressly
granted authority to establish, by resolution or resolutions adopted before the
issuance of any shares of a particular series of Additional Preferred Stock,
the powers, preferences and rights of each series and the qualifications,
limitations or restrictions thereof, including but not limited to the
following:
(i) The voting powers, full, special or limited, or no voting
powers, of such series of Additional Preferred Stock;
(ii) The rate, terms and conditions on which dividends, if
any, shall be paid, whether such dividends will be cumulative and what
preference such dividends have in relation to the dividends on other series or
classes of stock;
(iii) The rights, terms and conditions, if any, for conversion
of such series of Additional Preferred Stock into shares of other series or
classes of stock;
(iv) Any right of the Corporation to redeem the shares of
such series of Additional Preferred Stock, and the price, time and conditions
of such redemption, including the provisions for any sinking fund; and
(v) The rights of holders of such series of Additional
Preferred Stock upon liquidation, distribution of assets, consolidation or sale
of assets by the Corporation.
(b) Unless the Board of Directors otherwise provides in the
resolution establishing a series of Additional Preferred Stock, upon repurchase
of the Corporation, redemption or conversion, the shares of Additional
Preferred Stock shall revert to authorized but unissued shares and may be
reissued as shares of any series of Additional Preferred Stock.
(c) In case the stated dividends and the amounts payable on
liquidation are not paid in full, each share of any series of Additional
Preferred Stock shall share ratably with each other share of any series of
Additional Preferred
-2-
3
Stock, but not with any shares of Common Stock, (a) in the payment of
dividends, including cumulations, if any, in accordance with the sums which
would be payable on such share if all dividends were declared and paid in full
and (b) in any distribution of assets other than by way of dividends, in
accordance with the sums which would be payable in such distribution if all
sums payable were discharged in full.
(d) The holders of Additional Preferred Stock shall be
entitled to receive when and as declared by the Board of Directors, but only
out of assets legally available for the payment of dividends, cash dividends at
the annual rate of each series fixed by the Board of Directors at the time of
the original authorization of the issue of the shares of such series.
(e) So long as any share of Additional Preferred Stock shall
be outstanding, the Corporation shall not declare, pay or set apart for payment
any dividends (other than dividends payable in Common Stock) on the Common
Stock, make any other distributions on the Common Stock, or redeem, purchase or
otherwise acquire for consideration or permit any subsidiary of the Corporation
to purchase or otherwise acquire for consideration any Common Stock unless all
accrued dividends of the Additional Preferred Stock of all series, including
any unpaid cumulative dividends thereon, but without interest, shall have been
paid and full dividends thereon for the then current dividend period shall have
been paid or declared, and a sum sufficient for the payment thereof set apart.
Notwithstanding the foregoing, the Corporation may at any time redeem, purchase
or otherwise acquire shares of Common Stock in exchange for, or out of the net
proceeds from the sale of other use of, other shares of Common Stock.
(f) In the event of a liquidation, dissolution or winding up
of the affairs of the Corporation, whether voluntary or involuntary, but before
any distribution or payment shall be made to the holders of the Common Stock,
the holders of each series of Additional Preferred Stock shall be entitled to
be paid in cash the applicable liquidation price per share fixed at the time of
the original authorization of shares of such series and, in the case of each
share of Additional Preferred Stock having cumulative dividend rights, an
amount equal to all dividends (whether or not earned or declared) accrued and
unpaid thereon, but without interest, to the date fixed for such distribution
or payment.
-3-
4
IN WITNESS WHEREOF, Hanover Direct, Inc. has caused this
Certificate of Amendment of the Certificate of Incorporation to be signed on
its behalf by Edward J. O'Brien, the Senior Vice President, and attested by
Michael P. Sherman, the Secretary, this 19th day of January, 1994.
HANOVER DIRECT, INC.
By:/s/ Edward J. O'Brien
---------------------
Edward J. O'Brien
Senior Vice President
Attest:
By:/s/ Michael P. Sherman
----------------------
Michael P. Sherman
Secretary
-4-
5
CERTIFICATE OF DESIGNATION
OF
SERIES A CONVERTIBLE ADDITIONAL PREFERRED STOCK
OF
HANOVER DIRECT, INC.
__________________________________
(Pursuant to Section 151 of the
General Corporation Law of the State of Delaware)
___________________________________
Hanover Direct, Inc., a corporation organized and existing
under the laws of Delaware (the "Corporation"), does hereby certify that,
pursuant to authority conferred on the Board of Directors of the Corporation by
the Certificate of Incorporation of the Corporation and in accordance with
Section 151 of the General Corporation Law of the State of Delaware, the Board
of Directors of the Corporation adopted the following resolution establishing
and creating a series of 234,900 shares of additional preferred stock, par
value $.01 per share, of the Corporation designated as "Series A Convertible
Additional Preferred Stock":
RESOLVED, that pursuant to the authority conferred on
the Board of Directors of the Corporation by the Certificate of
Incorporation, a series of additional preferred stock, par value $.01
per share, of the Corporation is hereby established and created, and
that the designation and number of shares and the voting and other
powers, preferences and relative, participating, optional or other
rights of the shares of such securities, and the qualifications,
limitations and restrictions thereof, are as follows:
Series A Convertible Additional Preferred Stock
(a) Designation and Amount. There shall be a series of
additional preferred stock, par value $.01 per share (the "Additional Preferred
Stock"), designated as "Series A Convertible Additional Preferred Stock," and
the number of shares constituting such series shall be 234,900, each share
having a stated value upon issuance of $10.00. Such series is referred to
herein as the "Series A Preferred."
6
(b) Rank. As to payment of dividends and as to distributions
of assets upon liquidation, dissolution or winding up of the Corporation,
whether voluntary or involuntary, all shares of Series A Preferred shall rank
prior to all of the Corporation's Common Stock, par value $.66-2/3 per share
(the "Common Stock"), and Class B Common Stock, par value $.01 per share, shall
rank equal to any other hereinafter issued series of Additional Preferred Stock
and shall be subordinate to all of the Corporation's 7.5% cumulative
convertible preferred stock, par value $.01 and stated value of $20 per share
(the "7.5% Preferred"), and the class B 8% cumulative preferred stock, par
value $.01 per share and stated value of $1,000 per share (the "Class B
Preferred").
(c) Dividends. The holders of record of shares of the Series
A Preferred shall be entitled to receive dividends, out of funds legally
available therefor, at a rate of 6% of the stated value per annum. Dividends
on the Series A Preferred shall commence to accrue on September 30, 1993, and
shall accrue cumulatively and be added to the stated value on a daily basis
whether or not earned or expressly declared by the Board of Directors.
(d) Liquidation Preference. In the event of any distribution
of assets upon any liquidation, dissolution or winding-up of the Corporation,
whether voluntary or involuntary, after payment or provision for payment of the
debts and other liabilities of the Corporation, the holder of each share of the
then outstanding Series A Preferred shall be entitled to receive out of the
assets of the Corporation, whether such assets are capital, surplus or
earnings, an amount equal to the then stated value of each share of Series A
Preferred, before any payments or distributions are made to, or set aside for,
any other equity security of the Corporation other than the holders of the 7.5%
Preferred, the Class B Preferred and any other series of Additional Preferred
Stock. If the assets of the Corporation are insufficient to pay such amounts
in full, then the entire assets of the Corporation shall first be distributed
to the holders of the 7.5% Preferred and the Class B Preferred and then, pro
rata, to the holders of shares of Additional Preferred Stock. Neither a
consolidation, merger or other business combination of the Corporation with or
into another corporation or other entity nor a sale or transfer of all or part
of the Corporation's assets for cash, securities or other property shall be
considered a liquidation, dissolution or winding up of the Corporation for
purposes of this paragraph (d).
(e) Conversion. On September 30, 1994, each holder of the
Series A Preferred shall automatically, without any action being required on
the part of such
-2-
7
holder, have one-third of each such holders holdings of Series A Preferred (the
"First Conversion Allotment") converted into a number of shares of Common Stock
of the Corporation determined by dividing the then stated value of the shares
by the Conversion Price. On September 30, 1995, each holder of the Series A
Preferred shall automatically, without any action being required on the part of
such holder, have one-half of each such holders holdings of Series A Preferred
(the "Second Conversion Allotment") converted into a number of shares of Common
Stock determined by dividing the then stated value of the shares by the
Conversion Price. On September 30, 1996, all shares of the Series A Preferred
that remain outstanding (the "Final Conversion Allotment") shall automatically,
without any action being required on the part of the holders thereof, be
converted into a number of shares of Common Stock determined by dividing the
then stated value of the shares by the Conversion Price. Each of September 30,
1994, September 30, 1995 and September 30, 1996 is referred to herein as a
"Conversion Date." The "Conversion Price" shall be an amount equal to the
average of the per-share closing prices (regular way) for a round lot of the
Common Stock on the American Stock Exchange (or, if the Common Stock is then
not listed for trading on the American Stock Exchange, such other exchange or
system on which the Common Stock shall from time to time be traded) on each of
the five trading days immediately preceding a Conversion Date.
Promptly upon the occurrence of a Conversion Date, the
Corporation, or its stock transfer agent at the direction of the Corporation,
shall give notice by first class mail, postage prepaid, to each holder of
record on the Conversion Date of the Series A Preferred at such holder's
address as it shall appear upon the stock transfer books of the Corporation.
Each such notice of conversion shall specify the Conversion Date and the number
of shares of Common Stock into which such shares of Series A Preferred have
been converted, and be accompanied by certificates representing the number of
full shares of Common Stock into which such Series A Preferred has been
converted, registered in the same name and address in which such Series A
Preferred is then registered, and any cash adjustment in lieu of fractional
shares as hereinafter provided.
Any notice that is mailed as herein provided shall be
conclusively presumed to have been duly given, whether or not the holder of the
Series A Preferred receives such notice; and failure to give such notice by
mail, or any defect in such notice, to the holders of any of the shares of
outstanding Series A Preferred shall not affect the validity of the proceedings
for the conversion of any of the shares of Series A Preferred. Within 5 days
following receipt of such notice, holders of shares of Series A
-3-
8
Preferred shall surrender the certificate or certificates for such shares of
Series A Preferred at the office of the Corporation or the Corporation's stock
transfer agent, which certificate or certificates, if the Corporation shall so
require, shall be duly endorsed to the Corporation or in blank, or accompanied
by proper instruments of transfer to the Corporation or in blank.
Subject to the provisions hereof, such conversion shall be
deemed to have been made as of the Conversion Date, and the person or persons
entitled to receive the Common Stock deliverable upon conversion of such Series
A Preferred shall be treated for all purposes as the record holder or holders
of such Common Stock on such date.
No fractional shares or scrip representing fractional shares
of Common Stock shall be issued upon conversion of Series A Preferred. If more
than one certificate representing shares of Series A Preferred shall be
surrendered for conversion at one time by the same holder, the number of full
shares issuable upon conversion thereof shall be computed on the basis of the
aggregate number of shares of Series A Preferred so surrendered. Instead of
any fractional share of Common Stock that would otherwise be issuable upon
conversion of any shares of Series A Preferred, the Corporation will pay a cash
adjustment in respect of such fractional interest in an amount equal to the
same fraction of the Conversion Price per share of Common Stock.
The Corporation shall at all times receive and keep available,
out of its authorized and unissued stock, solely for the purpose of affecting
the conversion of the Series A Preferred, such number of shares of its Common
Stock free of preemptive rights as shall from time to time be sufficient to
effect the conversion of all shares of Series A Preferred from time to time
outstanding. The Corporation shall from time to time, in accordance with the
laws of the State of Delaware, increase the authorized number of shares of
Common Stock if at any time the number of shares of Common Stock not
outstanding shall not be sufficient to permit the conversion of all the then
outstanding shares of Series A Preferred.
The Corporation will pay any and all issue or other taxes that
may be payable in respect of any issue or delivery of shares of Common Stock on
conversion of any shares of Series A Preferred. The Corporation shall not,
however, be required to pay any tax that may be payable in respect of any
transfer involved in the issue or delivery of Common Stock (or other securities
or assets) in a name other than that in which the shares of Series A Preferred
so converted were registered, and no such issue or delivery
-4-
9
shall be made unless and until the person requesting such issue has paid to the
Corporation the amount of such tax or has established, to the satisfaction of
the Corporation, that such tax has been paid.
(f) Redemption. The Corporation shall have the right to
redeem the First Conversion Allotment at any time prior to September 20, 1994,
the Second Conversion Allotment at any time prior to September 20, 1995 and the
Final Conversion Allotment at any time prior to September 20, 1996 at the
liquidation value (initial stated value plus all accrued but unpaid dividends)
of such shares payable in cash. In the event the Corporation shall redeem any
such shares of Series A Preferred, notice of such redemption shall be given by
first-class mail, postage prepaid, mailed not less than 10 days nor more than
30 days prior to the redemption date (the "Redemption Date"), to each holder of
record of the shares to be redeemed at such holder's address as the same
appears on the stock register of the Corporation; provided, however, that no
failure to mail such notice nor any defect therein shall affect the validity of
the proceeding for the redemption of any shares of Series A Preferred to be
redeemed except as to the holder to whom the Corporation has failed to mail
said notice or except as to the holder whose notice was defective. Each such
notice shall state: (i) the Redemption Date, (ii) the redemption price, (iii)
the place or places where certificates for such shares are to be surrendered
for payment of the redemption price, and (iv) that dividends on the shares to
be redeemed will cease to accrue on the day following the Redemption Date
unless the Corporation defaults in making payment of the redemption price.
Upon the Redemption Date, the holders of the Series A
Preferred shares which are to be redeemed (the "Redemption Shares") shall
deliver certificates for their shares to the Corporation against payment of the
redemption price. Unless the Corporation shall default in the making of such
payment, dividends shall cease to accrue on the Redemption Shares on the day
following the Redemption Date whether or not the certificates therefor are
delivered to the Corporation.
(g) Voting Rights. The holders of the Series A Preferred
shall not have any voting rights except as may be required by law.
(h) Status of Acquired Shares. Shares of Series A Preferred
received by the Corporation pursuant to paragraphs (e) or (f) hereof, or
otherwise acquired by the Corporation, will be restored to the status of
authorized and unissued shares of Additional Preferred Stock, without
-5-
10
designation as to series, and may thereafter be issued, but not as shares of
Series A Preferred.
(i) Preemptive Rights. The Series A Preferred is not
entitled to any preemptive or subscription rights in respect of any securities
of the Corporation.
-6-
11
IN WITNESS WHEREOF, Hanover Direct, Inc. has caused this
Certificate of Designation of Series A Convertible Additional Preferred Stock
to be signed on its behalf by Edward J. O'Brien, the Senior Vice President, and
attested by Michael P. Sherman, the Secretary, this 19th day of January, 1994.
HANOVER DIRECT, INC.
By:/s/ Edward J. O'Brien
---------------------
Edward J. O'Brien
Senior Vice President
Attest:
By:/s/ Michael P. Sherman
----------------------
Michael P. Sherman
Secretary
-7-
12
STATE OF New Jersey, )
) ss.
COUNTY OF Hudson. )
On this 19th day of January, 1994, personally appeared before
me, a notary public, EDWARD J. O'BRIEN, as Senior Vice President of Hanover
Direct, Inc., personally known to me to be the person whose name is subscribed
to the above instrument and who acknowledged that he executed the above
instrument on behalf of the Corporation.
Patricia Linda Williams
Notary Public of New
Jersey
Commission expires Jan. 10, 1997
STATE OF New Jersey, )
) ss.
COUNTY OF Hudson. )
On this day of January, 1994, personally appeared before
me, a notary public, MICHAEL P. SHERMAN, as Secretary of Hanover Direct, Inc.,
personally known to me to be the person whose name is subscribed to the above
instrument and who acknowledged that he executed the above instrument on behalf
of the Corporation.
Patricia Linda Williams
Notary Public of New
Jersey
Commission expires Jan. 10, 1997
-8-